CMS Energy Corp and its joint venture partner A.H. Al Zamil Group have been selected as the preferred bidder for Saudi Arabia's power co-generation project, Sadaf, a senior CMS official said.

The project will be the first privately-owned independent power plant in Saudi Arabia. CMS surmounted competition from four other bidders — Enron, Tractabel, Enel Power and Mitsubishi. Sadaf is an equal venture between Saudi Arabia Basic Industries Corp (Sabic) and Shell Chemical. CMS Energy won the contract for the UAE's first independent power project, Taweelah A2, in 1998.

The Saudi co-generation project will supply 230 megawatts of power and 510 tonnes an hour of steam production capacity under a 20-year energy conversion agreement. The project will be fuelled by natural gas supplied by Sadaf.

CMS Energy's independent power unit, CMS Generation Co, will co-manage the construction and operation of the project through a joint project company. "This opportunity to work with Sadaf is significant for CMS since it positions the company as an important player in the forthcoming private sector power development in Saudi Arabia," said Joe Tomasik, CMS Energy's vice-president of development.

"The selection as preferred bidder clearly shows the continuing confidence clients such as Sadaf have in CMS' capabilities and its regional experience." The venture expects to achieve financial closure expeditiously to meet Sadaf's stringent completion deadline. Construction is scheduled to commence before the year-end.

The Al Zamil group is a leading industrial and commercial organisation in Saudi Arabia. CMS Energy has annual sales of $11 billion and assets of about $16 billion with businesses in electric and natural gas utility operations, independent power production, natural gas pipelines, gathering, processing and storage, oil and gas exploration and production and energy marketing, services and trading.